SKS Microfinance looks to raise $183m through share sale
The board of SKS Microfinance has approved a motion to raise an additional INR9 billion ($183.2 million) through a share sale to private institutional investors.
SKS will facilitate the sale through qualified institutional placements (QIP), LiveMint reported, and has been given approval to raise its authorised capital from INR950 million to INR1.35 billion.
The capital is expected to be used to write off loans at the quarter's end and grow its own loan book.
SKS' loan book decreased from approximately INR50 billion in September 2010 to INR34.5 billion in June. Loans to residents of Andhra Pradesh account for 37.5% of SKS' portfolio, a rise from 26% last year. Andhra Pradesh is one of the most concentrated areas globally for microloans, and was a particular focus last year after a spate of suicides by borrowers in the area, allegedly after being hounded by their lenders. The event led Indian regulators to introduce measure to curb over-aggressive debt collecting procedures by microfinance institutions (MFIs).
The scandal had a widespread affect on India's microfinance sector, stymieing investment into the space. SKS - which raised $350 million in its August 2010 IPO - saw its share value drop 79.62% from the issue price of INR985. One of the suicide victims was said to be a borrower from SKS.
However, in early August, news of IFC's interest in Bandhan sparked interest among observers keen to determine if capital would begin to flow back into India's microfinance sector.
More on South Asia
Latest News
Asian GPs slow implementation of ESG policies - survey
Asia-based private equity firms are assigning more dedicated resources to environment, social, and governance (ESG) programmes, but policy changes have slowed in the past 12 months, in part due to concerns raised internally and by LPs, according to a...
Singapore fintech start-up LXA gets $10m seed round
New Enterprise Associates (NEA) has led a USD 10m seed round for Singapore’s LXA, a financial technology start-up launched by a former Asia senior executive at The Blackstone Group.
India's InCred announces $60m round, claims unicorn status
Indian non-bank lender InCred Financial Services said it has received INR 5bn (USD 60m) at a valuation of at least USD 1bn from unnamed investors including “a global private equity fund.”
Insight leads $50m round for Australia's Roller
Insight Partners has led a USD 50m round for Australia’s Roller, a venue management software provider specializing in family fun parks.